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Global Marketing PDF

672 Pages·2007·8.6 MB·English
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A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page i Global Marketing F I F T H E D I T I O N WarrenJ.Keegan Lubin Graduate School of Business Pace University—New York City and Westchester, New York MarkC.Green Department of Business Administration and Economics Simpson College—Indianola, Iowa Upper Saddle River, New Jersey 07458 A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page ii Library of Congress Cataloging-in-Publication Data Keegan, Warren J. Global marketing/Warren J. Keegan, Mark C. Green.—5th ed. p. cm. Includes bibliographical references and index. ISBN-13: 978-0-13-175434-8 (pbk. : alk. paper) 1. Export marketing. I. Green, Mark C. II. Title. HF1416.K443 2008 658.8(cid:2)4—dc22 2007039742 Editor-in-Chief:David Parker Cover Photo China:Linda Whitwam/ Product Development Manager:Ashley Santora Dorling Kindersley Project Manager, Editorial:Melissa Pellerano Illustration (Interior):Integra Software Editorial Assistant:Christine Ietto Services Assistant Editor, Media:Denise Vaughn Director, Image Resource Center: Media Project Manager:Lisa Rinaldi Melinda Patelli Marketing Manager:Anne Howard Manager, Rights and Permissions: Marketing Assistant:Susan Osterlitz Zina Arabia Senior Managing Editor:Judy Leale Manager, Visual Research:Beth Brenzel Project Manager, Production:Kelly Warsak Manager, Cover Visual Research & Manager, Rights & Permissions:Charles Morris Permissions:Karen Sanatar Senior Operations Supervisor:Arnold Vila Image Permission Coordinator:Ang’John Art Director:Steve Firm Ferreri Interior Design:Michael Fruhbeis Photo Researcher:Teri Stratford Cover Design:Steve Firm Composition:Integra Software Services Cover Photo Brazil:Antonio Scorza/AFP/ Full-Service Project Management:Jennifer Getty Images Welsch/BookMasters, Inc. Cover Photo Russia:Alexander Nemenov/AFP/ Printer/Binder:Courier/Kendallville Getty Images, Inc. Cover Printer:Phoenix Color Corp. Cover Photo India:Steve Raymer/Corbis Typeface:10/12 Palatino Credits and acknowledgments borrowed from other sources and reproduced, with permission, in this textbook appear on appropriate page within text as well as on pages 613–616. Copyright © 2008, 2005, 2003, by Warren J. Keegan.Published by Pearson Prentice Hall. All rights reserved. Printed in the United States of America. This publication is protected by Copyright and permission should be obtained from the publisher prior to any prohibited reproduction, storage in a retrieval system, or transmission in any form or by any means, electronic, mechanical, photocopying, recording, or likewise. For information regarding permission(s), write to: Rights and Permissions Department. Pearson Prentice Hall™is a trademark of Pearson Education, Inc. Pearson®is a registered trademark of Pearson plc Prentice Hall®is a registered trademark of Pearson Education, Inc. Pearson Education LTD. Pearson Education Australia PTY, Limited Pearson Education Singapore, Pte. Ltd Pearson Education North Asia Ltd Pearson Education, Canada, Ltd Pearson Educación de Mexico, S.A. de C.V. Pearson Education–Japan Pearson Education Malaysia, Pte. Ltd. 10 9 8 7 6 5 4 3 2 1 ISBN-13: 978-0-13-175434-8 ISBN-10: 0-13-175434-3 A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page iii To Lauren, Tommy, and Jonny —WJK To John W. Green, Jr. and Virginia G. Green —MCG A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page iv A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page v BRIEF CONTENTS Preface xv Acknowledgments xix About the Authors xxii In Memoriam xxiv PART 1 INTRODUCTION 2 Chapter 1 Introduction to Global Marketing 2 Case 1-1 McDonald’s Expands Globally While Adjusting Its Local Recipe 35 Case 1-2 Acer Inc. 38 PART 2 THE GLOBAL MARKETING ENVIRONMENT 40 Chapter 2 The Global Economic Environment 40 Case 2-1 From Communism to Capitalism: Vietnam’s Economic Transformation 71 Case 2-2 Is China’s Currency Too Strong? 74 Chapter 3 The Global Trade Environment 76 Case 3-1 The Free Trade Area of the Americas 108 Chapter 4 Social and Cultural Environments 110 Case 4-1 Fair Trade Coffee: Ethics, Religion, and Sustainable Production 142 Case 4-2 Barbie: Growing Pains as the American Girl Goes Global 143 Chapter 5 The Political, Legal, and Regulatory Environments of Global Marketing 146 Case 5-1 America’s Cuban Conundrum 180 Case 5-2 Gambling Goes Global on the Internet 183 PART 3 APPROACHING GLOBAL MARKETS 184 Chapter 6 Global Information Systems and Market Research 184 Case 6-1 Research Helps Whirlpool Act Local in the Global Market 217 Chapter 7 Segmentation, Targeting, and Positioning 220 Case 7-1 Carmakers Target Gen Y 255 Case 7-1 The Youth of the World Proclaim, “We Want Our MTV!” 256 Chapter 8 Importing, Exporting, and Sourcing 258 Case 8-1 Concerns About Factory Safety and Worker Exploitation in Developing Countries 288 Case 8-2 U.S. Sugar Subsidies: Too Sweet a Deal? 290 Chapter 9 Global Market Entry Strategies: Licensing, Investment, and Strategic Alliances 292 Case 9-1 Ford Bets Billions on Jaguar 323 Case 9-2 SABMiller in China 324 v A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page vi PART 4 THE GLOBAL MARKETING MIX 326 Chapter 10 Product and Brand Decisions 326 Case 10-1 Now Underway in Your Living Room: The Video Game Console Wars 359 Case 10-2 The Smart Car 360 Chapter 11 Pricing Decisions 362 Case 11-1 LVMH and Luxury Goods Marketing 394 Chapter 12 Global Marketing Channels and Physical Distribution 398 Case 12-1 Carrefour Expands Abroad 431 Case 12-2 The Future of RFID 432 Chapter 13 Global Marketing Communications Decisions I: Advertising and Public Relations 434 Case 13-1 Adidas AG 466 Chapter 14 Global Marketing Communications Decisions II: Sales Promotion, Personal Selling, Special Forms of Marketing Communication 468 Case 14-1 Marketing an Industrial Product in Latin America 500 PART 5 STRATEGY AND LEADERSHIP IN THE TWENTY-FIRST CENTURY 502 Chapter 15 Strategic Elements of Competitive Advantage 502 Case 15-1 Kodak in the Twenty-First Century: The Search for New Sources of Competitive Advantage 533 Case 15-2 LEGO 534 Chapter 16 Leading, Organizing, and Controlling the Global Marketing Effort 536 Case 16-1 Boeing Versus Airbus: ABattle for the Skies 564 Chapter 17 The Digital Revolution and the Global E-Marketplace 568 Case 17-1 eBay in Asia 593 Case 17-2 Barry Diller and IAC/InterActiveCorp 594 Glossary 597 Credits 613 Author/Name Index 617 Subject/Organization Index 627 vi Brief Contents A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page vii CONTENTS Preface xv Acknowledgments xix About the Authors xxii In Memoriam xxiv PART 1 INTRODUCTION 2 Chapter 1 Introduction to Global Marketing 2 Introduction and Overview 3 Principles of Marketing: AReview 5 Competitive Advantage, Globalization, and Global Industries 6 Global Marketing: What It Is and What It Isn’t 10 The Importance of Global Marketing 15 Management Orientations 17 Ethnocentric Orientation 19 Polycentric Orientation 20 Regiocentric Orientation 21 Geocentric Orientation 22 Forces Affecting Global Integration and Global Marketing 24 Multilateral Trade Agreements 24 Converging Market Needs and Wants and the Information Revolution 25 Transportation and Communication Improvements 26 Product Development Costs 26 World Economic Trends 28 Leverage 28 Restraining Forces 30 Outline of This Book 32 PART 2 THE GLOBAL MARKETING ENVIRONMENT 40 Chapter 2 The Global Economic Environment 40 The World Economy: An Overview 41 Economic Systems 44 Market Capitalism 45 Centrally Planned Socialism 45 Centrally Planned Capitalism and Market Socialism 46 Stages of Market Development 50 Low-Income Countries 50 Lower-Middle-Income Countries 52 Upper-Middle-Income Countries 52 Marketing Opportunities in LDCs and Developing Countries 53 High-Income Countries 57 The Triad 60 Marketing Implications of the Stages of Development 60 Balance of Payments 61 vii A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page viii Trade in Merchandise and Services 63 Overview of International Finance 65 Purchasing Power Parity 66 Economic Exposure 67 Managing Exchange Rate Exposure 67 Chapter 3 Regional Market Characteristics and Preferential Trade Agreements 76 The WTO and GATT 77 Preferential Trade Agreements 78 Free Trade Area 79 Customs Union 7979 Common Market 80 Economic Union 80 North America 80 Latin America: SICA, Andean Community, Mercosur, CARICOM 84 Central American Integration System 84 Andean Community 86 Common Market of the South (Mercosur) 87 Caribbean Community and Common Market (CARICOM) 89 Current Trade-Related Issues 90 Asia-Pacific: The Association of Southeast Asian Nations (ASEAN) 91 Marketing Issues in the Asia-Pacific Region 92 Western, Central, and Eastern Europe 93 The European Union (EU) 93 The European Free Trade Area (EFTA) and European Economic Area (EEA) 96 Marketing Issues in the EU 96 The Lomé Convention and the Cotonou Agreement 98 Central European Free Trade Association (CEFTA) 98 The Middle East 99 Cooperation Council for the Arab States of the Gulf 100 Marketing Issues in the Middle East 102 Africa 102 Economic Community of West African States (ECOWAS) 102 East African Cooperation 105 Southern African Development Community (SADC) 105 Chapter 4 Social and Cultural Environments 110 Society, Culture, and Global Consumer Culture 110 Attitudes, Beliefs, and Values 112 Religion 113 Aesthetics 114 Dietary Preferences 117 Language and Communication 118 Marketing’s Impact on Culture 122 High- and Low-Context Cultures 125 Hofstede’s Cultural Typology 126 The Self-Reference Criterion and Perception 132 Diffusion Theory 134 The Adoption Process 134 Characteristics of Innovations 135 Diffusion of Innovations in Pacific Rim Countries 136 Marketing Implications of Social and Cultural Environments 137 viii Contents A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page ix Chapter 5 The Political, Legal, and Regulatory Environments of Global Marketing 146 The Political Environment 147 Nation-States and Sovereignty 147 Political Risk 148 International Law 154 Common Law Versus Civil Law 155 Islamic Law 156 Sidestepping Legal Problems: Important Business Issues 157 Jurisdiction 157 Intellectual Property: Patents, Trademarks, and Copyrights 158 Antitrust 164 Licensing and Trade Secrets 167 Bribery and Corruption: Legal and Ethical Issues 169 Conflict Resolution, Dispute Settlement, and Litigation 173 Alternatives to Litigation for Dispute Settlement 174 The Regulatory Environment 176 Regional Economic Organizations: The EU Example 176 PART 3 APPROACHING GLOBAL MARKETS 184 Chapter 6 Global Information Systems and Market Research 184 Information Technology for Global Marketing 185 Sources of Market Information 190 Formal Market Research 192 Step 1: Identify the Information Requirement 195 Step 2: Problem Definition 195 Step 3: Choose Unit of Analysis 196 Step 4: Examine Data Availability 196 Step 5: Assess Value of Research 198 Step 6: Research Design 198 Step 7: Analyzing Data 208 Step 8: Presenting the Findings 213 Headquarters Control of Marketing Research 213 The Marketing Information System as a Strategic Asset 214 Chapter 7 Segmentation, Targeting, and Positioning 220 Global Market Segmentation 221 Demographic Segmentation 224 Psychographic Segmentation 230 Behavior Segmentation 232 Benefit Segmentation 234 Ethnic Segmentation 235 Assessing Market Potential and Choosing Target Markets or Segments 237 Current Segment Size and Growth Potential 238 Potential Competition 239 Feasibility and Compatibility 240 AFramework for Selecting Target Markets 240 Product-Market Decisions 243 Target Market Strategy Options 244 Standardized Global Marketing 244 Concentrated Global Marketing 245 Differentiated Global Marketing 246 Contents ix A01_KEEG4348_05_SE_FM.QXD 10/19/07 1:05 AM Page x Positioning 247 Attribute or Benefit 248 Quality and Price 248 Use or User 248 Competition 249 Global, Foreign, and Local Consumer Culture Positioning 250 Chapter 8 Importing, Exporting, and Sourcing 258 Export Selling and Export Marketing: AComparison 259 Organizational Export Activities 260 National Policies Governing Exports and Imports 261 Government Programs that Support Exports 263 Governmental Actions to Discourage Imports and Block Market Access 265 Tariff Systems 270 Customs Duties 272 Other Duties and Import Charges 272 Key Export Participants 273 Organizing for Exporting in the Manufacturer’s Country 275 Organizing for Exporting in the Market Country 276 Export Financing and Methods of Payment 276 Documentary Credit 277 Documentary Collections (Sight or Time Drafts) 278 Cash in Advance 279 Sales on Open Account 279 Additional Export and Import Issues 280 Sourcing 280 Management Vision 282 Factor Costs and Conditions 282 Customer Needs 283 Logistics 284 Country Infrastructure 284 Political Factors 284 Foreign Exchange Rates 285 Chapter 9 Global Market Entry Strategies: Licensing, Investment, and Strategic Alliances 292 Licensing 293 Special Licensing Arrangements 295 Investment 297 Joint Ventures 298 Investment via Ownership or Equity Stake 301 Global Strategic Partnerships 306 The Nature of Global Strategic Partnerships 307 Success Factors 310 Alliances with Asian Competitors 311 CFM International, GE, and SNECMA: ASuccess Story 312 Boeing and Japan: AControversy 312 International Partnerships in Developing Countries 314 Cooperative Strategies in Japan: Keiretsu 315 How KeiretsuAffect American Business: Two Examples 317 Cooperative Strategies in South Korea: Chaebol 318 x Contents

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